On Sept. 27, 432 rallies by workers at post offices nationwide were intended to bring the possibility to the attention of the American public.
The United States Postal Service is in hot water financially lately. A major factor in the struggles the organization is facing is the pre-funding mandate posed by Congress in 2007, which requires the USPS to prepay retiree benefits 75 years into the future within 10 years by 2017, according to Gary Hufstettler, district coordinator for the American Postal Workers Union.
“The reason we are in debt is because of this mandate,” Hufstettler said. “That would bankrupt any corporation in America.”
“We’re trying to get our state representative to sign onto 1351,” Bruce Potts, city mail carrier, said at the rally in September. “We’re paying for people that haven’t been born yet.”
“Our credit line is $15 billion. We’ve maxed that out paying the mandate,” Hufstettler said. The mandate was supposed to be paid on Sept. 30, but Congress granted a short reprieve until Nov.17 to correct the situation. Without the credit to pay the mandate, there is a need to figure out an alternative solution. There are two competing bills in the U.S. House of Representatives that would address the issues facing the USPS.
Two separate postal service audits show it has overpaid its pension funds by $50 billion to $75 billion, according to Hufstettler. Current law does not allow the USPS to access the extra money to pay the mandate. HR 1351 would give credit for that money, and allow the USPS to pull from the overages in the pension fund to pay the mandate.
“No taxpayer money will be taken,” Hufstettler said. The bill calls for an independent audit to confirm the overpayment to the pension fund. HR 1351 is supported by the postal service unions, as it doesn’t call for any layoffs or post office closures.
HR 2309 on the other hand isn’t welcomed by postal unions. The bill requires $2.4 billion in office closures and layoffs. “It destroys the postal service. Closing all these offices eliminates our competitive edge,” Hufstettler said. “This bill targets senior workers, those who have been here for decades and are making the most.”
Postal workers at the rallies said the postal service’s financial issues have been exploited by some to take away workers’ rights. “HR 2309 destroys collective bargaining,” Hufstettler said. “It’s Wisconsin on the national scale. They used the financial crisis to strip workers of rights and benefits … If not for this mandate, we would have been in the black, instead of in debt.”
Before the Internet, the postal service was necessary for the passage of information. “The U.S. Constitution requires that we have a postal service,” Greg Pratt, economics professor at MCC, said. “People with more information make higher-level decisions, leading to higher-level outcomes. In Benjamin Franklin’s time, the benefits clearly were greater than the cost. Mail service was the Internet.”
The question regarding how the benefits versus the cost weigh is raised.
“That’s the debate. College students don’t use mail, but their grandparents do,” Pratt said.